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News on Medial
Real-money gaming companies look for an ace to beat tax blues
Economic Times
·
1y ago
Medial
Gaming companies that offer online games involving real money, such as poker and fantasy sports, are implementing new approaches to discourage frequent withdrawals by users. These measures aim to minimize the impact of increased indirect tax and boost the companies' earnings. Some platforms are limiting the number of daily withdrawals, while others are adjusting the win percentages. The objective is to keep users' money in the system for longer, leading to higher compounded commission for the companies. These changes are being made in response to the new Goods and Services Tax (GST) regime, which has resulted in a 28% tax on player deposits.
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Related News
IPL Blues For Fantasy Gaming
Inc42
·
1y ago
Medial
Fantasy gaming apps in India are facing challenges in acquiring customers and marketing during IPL 2024 due to the impact of the Goods and Services Tax (GST). The clarity received last year regarding the 28% GST tax on real money gaming has led to cutbacks in marketing spends and layoffs for many startups in the fantasy gaming industry. The tax has resulted in a decline in user engagement and a drop in customer acquisition. As a result, fantasy gaming platforms are rethinking their strategies to avoid major losses during the IPL season.
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Government to impose 28% GST on online games
Entrackr
·
2y ago
Medial
The 50th Goods and Services Tax (GST) Council meeting on Tuesday decided that a 28% GST will be levied on the full face value of online gaming. The move deals a severe blow to the gaming companies that offer real-money games.
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Layoffs, Closures: 28% GST Hits Online Gaming Industry Hard As Authorities Begin Tax Recovery
OutlookIndia
·
1y ago
Medial
The implementation of a 28% tax on real money gaming (RMG) by the Goods and Services Tax (GST) Council has led to chaos in the online gaming industry in India. Several start-ups, including Dream11 and Games 24x7, have received tax notices amounting to around Rs 55,000 crore. Companies such as Super Group Limited and Nazara Technologies have already stopped operating in the Indian market, while others have resorted to layoffs. The new tax rate will also impact players' winnings and the competitiveness of gaming companies. The future of the industry remains uncertain as companies navigate the challenges posed by the tax changes.
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Real money gaming startup Fantok halts operations after 28% GST rule
Entrackr
·
2y ago
Medial
Fantok, a real money gaming app, temporarily halts operations due to the 28% GST on online real-money games imposed by the Indian government. Similar actions were taken by Mobile Premier League, Spartan Poker, Hike Rush Gaming Universe, One World Nation (OWN), and Quizy. The tax and operational challenges led Fantok to this decision, while they evaluate strategic pivots to align with the evolving regulatory landscape. Other gaming companies and investors have protested the GST decision as well.
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CCI orders probe against Google on Winzo’s complaint
Economic Times
·
9m ago
Medial
The Competition Commission of India (CCI) has ordered an investigation into Google for potential antitrust violations following a complaint by online gaming company Winzo. The investigation will look into allegations of Google's abuse of its dominant position and restrictive policies towards online gaming companies. Winzo claims that Google's Developer Distribution Agreement and Developer Program Policies contain unreasonable conditions, and that the Play Store restricts hosting of gaming apps offering real money games in India. The CCI has instructed its director general to submit a report within 60 days.
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Gaming firms offer to pick up tax bill to keep players hooked
Economic Times
·
1y ago
Medial
Online gaming platforms in India such as Dream11, Mobile Premier League, and Games24X7 are offering personalized offers and schemes to keep regular gamers and influencers engaged amid an increase in tax liability. The goods and services tax rate on real money gaming has been raised to 28%, resulting in platforms subsidizing the new tax liability through deposit offers and bonuses. The increased tax rate has driven users towards offshore and illegal gaming platforms that evade taxes and lack consumer protection measures, potentially impacting the growth of the online gaming industry in India.
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The dangers keeping India from winning the game
Economic Times
·
1y ago
Medial
In 2023, the Indian gaming industry faced multiple challenges. Some states banned real money games, followed by policy inconsistencies and the 28% goods and services tax on the sector. Despite these obstacles, the industry has managed to survive, although some companies had to close down. The current state of the Indian gaming sector is examined, and its future prospects are discussed.
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Real Money Gaming Key Revenue Driver In India’s Gaming Industry : Report
Inc42
·
1y ago
Medial
In FY22, real money gaming (RMG) accounted for 83-84% of the total revenue in the Indian gaming industry. Despite regulatory hurdles, the RMG sector attracts around 100 million online gamers daily, with 90 million of them paying to play. On average, users spend 8.5 hours per week on gaming. Additionally, the GST Council's decision to charge a 28% tax on entry fees has resulted in increased tax expenses for gaming startups.
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Setback after cashbacks: Gaming industry faces fresh GST trouble - The Economic Times
Economic Times
·
1m ago
Medial
The real money gaming industry in India is facing fresh challenges from GST authorities. Tax officials demand GST on cashbacks and bonuses given to players, treating these as taxable under Rule 31B. This intensifies the ongoing conflict over retrospective GST collection from 2017 to 2023. Gaming companies argue this interpretation is flawed and plan to challenge it in the Supreme Court. Some firms are considering forming a collective legal strategy as the tax issue gains momentum.
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Google vs startups game makes RMG platforms interested
Economic Times
·
1y ago
Medial
Online real-money gaming companies in India are concerned about the impact of Google's service fees, which are set to be implemented in June. The 15-30% fee, along with a 28% goods and services tax, is seen as unsustainable for businesses in the industry. Companies are considering various options to mitigate the impact, but delisting from the Play Store, which provides access to a large mobile gaming population in India, may not be a viable solution. Critics argue that the fee is unfair for an industry still trying to establish itself and that Google should instead support growth in the sector.
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